The Waterfront at Westport

M A R K E T O V E R V I E W

BALTIMORE MARKET HIGHLIGHTS Within a one-mile radius of the property, there are 107,000 jobs, 40,000 residents, and 19,000 students. This area ranks 16th in the country for employment density and 8th for residential density, ahead of cities like Atlanta, Denver, Miami, and Washington, DC. Millennial Market trends Baltimore continues its transformation into a premiere 24/7 city, seamlessly blending new luxuries with its colorful, homegrown personality to create an environment that is attracting more affluent young professionals than ever. Millennials have changed the face of the multifamily market and set a new standard for apartment developers and cities alike. While they demand upscale amenities, they are also attracted to authenticity. Their desire to be a part of something new and innovative is driving the manner in which Baltimore is becoming a magnet for this demographic group. College-educated residents between the ages of 25 and 34 living within three miles of Baltimore’s Central Business District increased by a staggering 92% from 2000 to 2010, the fourth highest growth rate among 51 metro areas (The Baltimore Sun, 2014). Baltimore also experienced a 7.0% growth in its Millennial population from 2009 to 2013, more than double the national rate. The increase in millennial migration to Baltimore has continued at a strong pace in recent years.

OFFICE MARKET OVERVIEW The Harbor East/Harbor Point neighborhood features the largest collection of new construction mixed-use office, residential and retail to be delivered in Downtown Baltimore. Since its inception, the Harbor East/Harbor Point submarket has significantly outpaced the occupancy levels of Class A office space throughout downtown Baltimore. Additionally, the neighborhood has successfully drawn new retailers to downtown Baltimore and it is the only submarket that can be identified as “High Street Retail.” Tenants who have opened locations in Harbor East/Harbor Point neighborhood include: Whole Foods Market; Anthropologie; J. Crew; Arhaus; Under Armour Brand House; Lululemon Athletica; and Bonobos. Additionally, the neighborhood has successfully landed relocations of corporate headquarters and business units from all over the Baltimore Metropolitan area as well as out of state. multifamily Baltimore’s multifamily market has been undergoing a significant growth surge, particularly in waterfront locations and within the core downtown neighborhoods. New-build, Class Amultifamily properties in these locations are generally considered “core” assets for institutional investors. The multifamily market in the Fells Point/Harbor East neighborhood is highlighted by a significant number of luxury, “Class A” properties. Owners of these trophy assets represent some of the most prominent multifamily developers and investors in the Mid-Atlantic. From General Investments’ Crescent at Fells, to Bozzuto’s Liberty Harbor East, these assets have contributed to making the submarket one of Baltimore’s most desirable live-work-play neighborhoods. The strength of the market from an investment sales standpoint is highlighted by the 2015 sale of Bozzuto’s Union Wharf Apartments which sold at a 4.5% CAP rate for more than $430,000 per unit, indicative of what is possible in this location.

Baltimore MSA

Washington, DC MSA

EMPLOYMENT GAINS for the 12 months ending Feb. 2017 PROJECTED JOB GROWTH annual average over next 5 years GROSS REGIONAL PRODUCT estimated 2015

+17.7K

+62.4K

+20.2K

+43.6K

$181B

$489B

Stabilized Vacancy Rate for Class A apartments

3.1%

4.1%

Employment data is from the Bureau of Labor Statistics. All other data is from Delta Associates Q1 2017.